New Obstacles Prolong California High Speed Rail Construction Delays

Groundbreaking on construction of the first segment of California's proposed high speed rail line connecting San Francisco to Los Angeles, originally scheduled for January 2013, and already pushed back to this coming July, is threatened with further significant delays because of federal regulatory and stats political difficulties. California's high speed rail authority lost the first round of its battle to keep the project out from under the jurisdiction of the federal Surface Transportation Board. The bullet train agency could take up to nine months in the process of seeking exemption from FSTB review of the entire project's design, financial and operational issues. Failure to procure the exemption could add years of regulatory wrangling delays to completion of the rail line.

Meanwhile, BNSF Railway, which already runs a freight line near the proposed route of the initial segment of the bullet train tracks, has sent a harsh letter to the authority's consultant Parsons Brinkerhoff, complaining that the agency has a planning process fraught with ambiguities and contradictions, including uncertainties respecting who has authority to negotiate on behalf of the state regarding the proposed route alongside BNSF's existing tracks through the Central Valley. BNSF asserts it will not approve high speed rail construction or operation alongside its right of way until the proposed route is clarified and safety issues concerning both construction and bullet train operations are resolved to its satisfaction.

California's House Rail Subcommittee Chairman Jeff Denham (R-Atwater) has scheduled a hearing for May 28 to address the BNSF issues, and California Senate Transportation Committee Chairman Mark DeSaulnier (D-Concord) has initiated an investigation into changes the bullet train agency made in its bid review process between the time of the bod opening and announcement of the successful bidder on the project. Opponents of the high speed rail project complain that the review process was altered in order to push costs which should be accounted for in the first segment construction estimate into later phases of the project to quell political opposition to the ultimate price taxpayers will pay for high speed rail in the state.

Meanwhile, all of this government regulatory and political posturing is setting back the timing of construction expenditures which could be a major boost to the west coast construction industry.

California High Speed Rail Details Emerging

Now that the California legislature has approved a $4.5 billion bond issue in order to claim $3.2 billion from federal taxpayers toward construction of a promised high speed rail link between Los Angeles and San Francisco, details of the difficulties faced in actually building the railroad tracks for these bullet trains are beginning to be released for public consumption. Here are just a few notes from detailed analysis of the proposed routing for the first 130 mile segment from Madera to Fresno, to be built at a cost of $2.6 billion out of the total budget of $68.4 billion for the entire project:

The California Department of Transportation anticipates it will cost $226 million and take three years to relocate a short stretch of highway 99 through Fresno where the roadway now nestles right up against the Union Pacific rail yards between Ashlan and Clinton Avenues. In order to make room for the bullet train tracks, 2.5 miles of the road will have to be torn up and replaced about 100 feet to the west, a frontage road will be built, along with 3 new Route 99 interchanges, and 50 private properties will be condemned and purchased by the state, displacing an assisted living facility, a mobile home park, a truck stop, an RV dealership, several motels, and two self storage facilities. The bullet train project budget will have to bear the cost of relocating all of these businesses.

According to plans of the high speed rail authority, 30% of the construction work on the project must be performed by small business subcontractors, and the authority is considering an additional requirement that one third of that goal, or 10% of the entire project budget, must be spent on work performed by minority and women owned businesses. In Chicago area government construction projects, the usual contract requirement is for 30% of the work to go to MBE/WBE trade subcontractors. It remains a puzzlement why California’s goals for disadvantaged business participation are so much lower.

California High Speed Rail Plans Under Attack In Washington

July 6 the California Senate voted 21-16 to approve a $4.5 billion bond issue funding construction of passenger rail transportation improvements in the state, including $2.6 billion for construction of the initial 130 mile run of high speed railroad tracks in the Central Valley, despite growing opposition in Congress to any further federal funding for the project. The California Senate vote came on the last day possible to permit the state to claim a grant of $3.2 billion in federal funds already allocated to the project since Florida, Ohio and Wisconsin have rejected grants for high speed rail development in their states which were approved under the 2009 stimulus legislation.

The party line California Senate vote drew praise from high speed rail supporters, and opprobrium from opponents, while in Washington, D.C. Republican determination to squelch the project grows stronger. The initial track run from Madera to Bakersfield is part of a proposed San Francisco to Los Angeles high speed line costing a projected $68 billion. The $1.9 billion balance of the bond proceeds approved Friday will go toward construction of passenger rail improvements elsewhere in the state, including electrification of Caltran, a commuter line from San Francisco to San Jose, and southern California Metrolink upgrades.

High speed rail supporters lavished praise on the bill. U. S. Secretary of Transportation Ray LaHood said, “No economy can grow faster than its transportation network allows. With highways between California cities congested and airspace at a premium, Californians desperately need an alternative.” Bay Area Council President and CEO Jim Wunderman called the vote “a courageous step forward for California’s future.

On the other side of the political aisle, Huntington Beach Republican Senator Tom Harman said, “It’s unfortunate that the majority would rather spend billions of dollars that we don’t have for a train to nowhere than to keep schools open and harmless from budget cuts.” Granite Bay Republican Senator Ted Gaines lamented that the project “will require endless subsidies and will blast a hole into our budget.” Finally, Palo Alto Democratic Senator Joe Simitian expressed doubts the LA to SF high speed line will ever see completion: “Is there additional commitment of federal funds? There is not. Is there additional commitment of private funding? There is not. Is there a dedicated funding source we can look to in the coming years? There is not.”

Senator Simitian’s dour outlook is not at all out of touch with reality. Republican opposition to high speed rail construction projects in general, and the SF to LA line in particular, peppered the final days of debate over the 27 month Highway Trust Fund reauthorization bill Congress just passed. June 29 the House voted 239-185 in favor of a proposed amendment to the measure which would have expressly prohibited any more federal dollars being spent on the California high speed rail construction project. Although that amendment was dropped from the final measure by the conference committee, Republican Congressmen from California remain adamant in opposition to further federal money going to high speed rail in their own state.

“In light of the federal government’s trillion dollar budget deficits, there is no money for a lot of things, including the poorly planned, massive boondoggle of high speed rail,” according to California Republican Congressman Devin Nunes. The House Appropriations Committee’s official report decries “unrealistic new high speed rails to nowhere.”

Mass transit in general, and high speed rail in particular, are popular targets for Republican congressional sniping. California Republican Congressman Jeff Denham, speaking in support of the proposed amendment banning further expenditures on California high speed rail development summed up the sentiment: “We need to make sure that our gas tax dollars get used for their intended purpose of actually improving our roads and highways.” It seems doubtful we will ever get those California Republican Representatives out of their Bentleys and onto the rails.

Wisconsin High Speed Rail Fiasco Costs US Taxpayers $14.6 Million

Wisconsin taxpayers are getting a bailout from the rest of the nation as the federal government just paid the state $14.6 million as reimbursement for costs sunk into the high speed rail contracting process the current Governor, Scott Walker campaigned against and terminated once he was elected. That payment from Washington D.C. won’t make up for all the lost Wisconsin taxpayer dollars going down the drain because of the Walker administration policy reversal, however.

Under Governor Jim Doyle, Wisconsin won a federal grant of $810 million to build a stretch of 110 m.p.h. high speed rail line between Milwaukee and Madison, and trains to run on the line, as a part of a proposed high speed upgrade of the Chicago to Minneapolis Empire Builder Amtrak route. When Governor Walker pulled out of that deal, the feds clawed back all but $2 million of the $801 million grant, but Wisconsin had already spent $9 million of the money, and was on the hook for another $5 million in cancellation fees and breach of contract claims by consultants and other private interests involved in the project. While the federal payment of $14.6 million covers those sunk costs, there are going to be other significant cancellation expenses Wisconsin taxpayers will have to pay for all by themselves.

The state has contracted with Spanish train builder Talgo to pay $71.8 million for high speed rail cars to run on the high speed Milwaukee to Madison line, and Talgo is already building and testing the cars in a factory it set up in Milwaukee expressly for that purpose. Wisconsin Transportation Secretary Mark Gottlieb says he has no use for those trains now, and he has canceled a $5.8 million per year maintenance contract with Talgo to keep the useless trains running. He is also backing out of a deal for state construction of a $63 million maintenance facility Talgo was to use in fulfilling the upkeep obligations. Talgo is threatening a lawsuit over these cancellations, and meanwhile continuing to test the now useless trains for delivery.

The $810 million federal grant Governor Walker turned down would have paid all these costs, but now Wisconsin is exposed to these liabilities all by itself. Walker’s “money saving” decision to squash high speed rail development in his state may cost a lot more than he says it was going to save.

Florida East Coast Industries Proposes Miami To Orlando Rail Line

Despite the State of Florida’s determination that high speed passenger rail travel to Orlando’s resorts would be a bad investment, private interests in the state are preparing to pour a billion dollars into development of passenger rail service between Orlando and Miami. Florida East Coast Industries just announced that it intends to offer rail travel between Miami and Orlando within the next two years, using 200 miles of existing track between Miami and Cocoa, and building new tracks from Cocoa to Orlando.

Florida East Coast spokesperson Christine Barney says the company expects its All Aboard Florida project to have station stops in Miami, Fort Lauderdale, West Palm Beach and Orlando. “There are 50 million people who travel between Orlando and Miami each year,” she said in announcing FEC’s All Aboard Florida plans. “And they’re mainly traveling on very congested highways. Obviously, if the Orlando to Miami routs is a success, we’ll look to expand.” Jacksonville Transportation Authority Executive Director Michael Blaylock is hoping his city is going to be included in that expansion. “I think all options are on the table,” Blaylock says. “But I can see a day when we have Amtrak, a private rail company and high speed rail all operating out of the Prime Osborn Convention Center.” He’s hoping for passenger rail operations to develop on CSX tracks from Jacksonville to Yulee and Green Cove Springs, and on FEC tracks to St. Augustine.

Christine Barney of FEC says the Miami to Orlando route should attract tourists as well as business people who don’t want to drive. FEC expects to invest $1 billion in the project, creating 6,000 construction jobs and 1,000 permanent jobs once the rail service begins. Travel times on the rail route are expected eventually to approximately equal the six hour driving time from Miami to Jacksonville.

Congress Won’t Fund California’s Ambitious High Speed Rail Any Time Soon

Over the course of construction, the latest business plan for the California High Speed Rail Authority calls for infusion of $42 billion in federal funds. So far the state has received $3.3 billion. The remaining $38.7 billion won’t be coming in any time soon. April 19 the Senate Appropriations Committee approved its version of funding legislation for transportation of all sorts, and there isn’t a dime in the measure specified for any high speed rail construction. While the only House legislation to fund transportation projects passed thus far has been two bills extending the Highway Trust Fund for three months each, and the final transportation funding bill will come out of a conference committee, the House already passed a measure sponsored by Congressman Jeff Denham to explicitly block any further funding for high speed rail in California.

While California high Speed Rail Authority Chairman Dan Richard denies Congressional reluctance to provide any more money is a setback, saying, “In our business plan, we do not expect any additional federal funds for at least three years,” he does not go on to predict that billions will be forthcoming in that short a time period. Elizabeth Alexis, co-founder of Californians Advocating Responsible Rail Design, states the obvious: “We continue to have the risk of either stranded investments, or the even bigger risk that California is forced to spend money it does not have to salvage something.”

Rolling Stock Without Tracks

Inter-city high speed rail in the United States is still just an engineering dream on paper, with no more than 20 miles of high speed trackage, running between two no account rural towns in Central Illinois anywhere near completion. In most locations slated for high speed bullet train operation, federal, state and local governments have yet to cobble together financial commitments to even begin construction of tracks capable of handling trains traveling over 100 mph. Nevertheless, on April 20 the Federal Railroad Administration began the bidding for construction of 130 high speed rail cars to operate on the as yet imaginary high speed railroad tracks.

FRA’s RFP is budgeted at $551 million. The 130 standardized bi-level cars are intended for use on high speed rail routes in California, Illinois, Indiana, Iowa, Michigan and Missouri. So far, the only high speed railroad track anywhere near completion is a 20 mile stretch between the small rural towns Dwight, Illinois and Pontiac, Illinois. A high speed rail bi-level is 85 feet long, so if all 130 cars were coupled end to end, the entire length of available high speed track will be only 10 trains long. Admittedly, this new rolling stock is intended for use on a Los Angeles to San Francisco route, plus Midwestern routes linking Chicago to Carbondale, Detroit, Dubuque, Grand Rapids, Kansas City, Moline, Port Huron, Quincy, Rockford, and St. Louis. However, no one has committed anywhere near the billions and billions of dollars needed to upgrade existing right of way, acquire new trackage rights, and build new tracks along any of these proposed routes. It seems just a bit premature to commit over half a billion dollars to rolling stock which presently has nowhere to go.

FRA is already planning a second round of bids for construction of locomotives capable of pushing or pulling these cars 125 mph should tracks capable of handling such speeds ever be built. Nobody in government has explained what will be done with 130 bi-level, high speed passenger cars when financing for track and station construction crumbles in Congress, state legislatures and local city councils and village boards across the country in today’s climate of high taxes, high unemployment, and deficit government budgets. Even the most imaginative high speed rail proposals acknowledge that government operating subsidies would be required to keep any of these trains running should tracks for them to run on ever magically materialize across our countryside. Are we busy building high speed railroad tracks to nowhere?

Changing Trains Across The Hudson

April 19 the Senate Appropriations Committee reported out a measure approving $20 million for continued design and engineering work on Amtrak’s Gateway Project, the last survivor among three projects to build a new pair of tunnels under the Hudson River to relieve rail congestion in the Northeast Corridor leading to Manhattan’s Penn Station. The Access to the Region’s Core rail tunnel project was scotched by New Jersey Governor Chris Christie, and a proposed extension of the Number 7 subway into Seacaucus, was scuttled by the New York MTA. Gateway is projected to cost a total of $14.5 billion, and would provide tunnels for both commuter trains and high speed rail into Penn Station.

Of course, Senate Appropriations approval is just one step in the process. The bill will still have to pass floor votes in both houses of Congress, and get President Obama’s signature. Gateway was originally announced in February 2011, with a projected price tag of $13.5 billion and a completion date of 2020. Now the price has increased by $1 billion, and the timeline extended to 2025. And the Gateway project has detractors, even among rail and transit advocates. Long Island Railroad’s Director of Planning Joe Clift points out that Gateway is designed more for inter-city high speed rail than cross Hudson commuters, and Amtrak spokesman Cliff Cole acknowledges that Gateway will not double peak hour commuter service, and that northern New Jersey commuters will have to change trains to reach Manhattan.

Gateway would increase NJ Transit commuter service from 20 trains per hour up to 36 per hour. So, while planning funds may materialize soon, there is no final agreement among the various agencies involved about cost sharing, nor is there any immediate prospect that $14.5 billion in construction funds will be committed to the Gateway project.

California High Speed Rail Chairman Urges $2.6 Billion Bond Approval

On April 18, High Speed Rail Authority Chairman Dan Richard urged two California legislative committees to approve $2.6 billion in state bond issues to start construction of high speed train tracks across the state’s Central Valley this year. This first phase of a proposed Los Angeles to San Francisco high speed rail line would cost a total of $5.9 billion, with the remaining $3.3 billion coming from the federal government. In 2008, California voters conditionally approved a total of $10 billion in state bond issues to finance the bullet trains.

Though no action was taken at Wednesday’s hearings, California legislators are vetting the possibility of budgeting for a total of $7 billion in state and federal high speed rail projects in their 2012-2013 budget. The pending proposal for the LA to Frisco bullet trains has a total projected cost of $68 billion, and has state lawmakers wondering whether a cash strapped federal Treasury can come up with the remaining $39 billion Chairman Richard’s plan is counting on from Washington to pay for construction.

At the hearings, Chairman Richard acknowledged that there are certain financial uncertaities in his proposal. “It’s just part and parcel of the transportation world that people don’t know these things now. The key then is, as you build, knowing you don’t know what you’ll be able to build next, can you build something of value?” he remarked. Long Beach State Senator Alan Lowenthal responded to Richard’s sentiments, “Don’t you think this is kind of a high risk strategy?” Lowenthal and other opponents  of potentially building a “bullet train to nowhere” oppose the concept of Governor Jerry Brown’s administration for using greenhouse gas emissions revenues from the 2006 California cap and trade program to pay for any portion of high speed rail construction not covered by the $10 billion in potential state bond issues, should the anticipated additional $39 billion in federal funds fail to materialize.

LA to Frisco High Speed Rail Project Flounders

Flounder: several species of fish whose young play dead on their sides on the bottom so long that as adults, both eyes end up on the same side of their heads.

Flounder is an apt description of the condition of the proposed high speed rail line from Los Angeles to San Francisco, initially proposed as one use of the federal stimulus funds appropriated three years ago by Congress for high speed rail construction. In 2008 California voters approved the project as Proposition 1A, including requirements that the first segment of the high speed line to be built must operate high speed trains, that money for each construction segment be in hand before beginning construction, that passengers on the completed project be able to board in Los Angeles and arrive in San Francisco without changing trains, and that the system operate 12 trains per hour between LA and SF without taxpayer operating subsidies. The latest version of the California High Speed Rail Authority business plan for the project, however, adopts a “blended” approach using existing rail lines in the cities at both ends, and cutting service at peak rush hour times to only two trains per hour. California State Senator Doug LaMalfa dubbed the new plans a bait and switch with a $55 billion funding gap.

Monday, April 2, 2012, the Authority issued its latest funding proposal for the project, whose projected cost has ranged from a high of $98.5 billion to a low of $30 billion, to the most recent estimate of $68.4 billion. Proposition 1A approved funding limited to $45 billion. Only $12.5 billion of the money is currently in hand: $3.5 billion in approved federal stimulus funding, and the $9 billion in construction bonds approved by California voters in Proposition 1A.  The balance of the nearly $56 billion the Authority now projects will be required to complete construction is projected to come in the form of an estimated additional $4 billion in federal grants, plus $1 billion a year from California’s auction of emissions credits under the state’s recently approved “cap and trade” air pollution credits. California high Speed Rail Authority Chairman Dan Richard, in announcing the latest version of the business plan for the project, said: “We’re hoping to get a federal commitment over the next ten years of at least $4 billion, and we’re going to do everything we can to develop private sector revenues from station development, right of way leasing and advertising. If that doesn’t close the gap, we’ve got the cap and trade funds as a backstop.”

Richards and the Authority are expected to approve the new estimates April 12, and then send the proposal forward to the legislature for funding of the initial bond issue. The initial federal grant of $3.5 billion, according to its terms, must be spent on construction before the end of 2017. Given the scepticism in Sacramento, mounting efforts to repeal Proposition 1A, and the possibility of missing the 2017 deadline and seeing the federal government’s $3.5 billion contribution “clawed back” under the terms of the stimulus bill’s “shovel ready” provisions, it’s no wonder the maturing version of this ambitious project looks nothing at all like the deal approved by California voters nearly four years ago.

Campaign Contributions Push Doubtful High Speed Rail Project Forward

Anthony Marnell II donated at least $15,000.00 to various campaign committees for Senate Majority Leader Harry Reid. Gary Tharaldson donated $10,000.00 to Reid’s campaign. Sig Rogich is co-chairman of Republicans for Reid.  What do these three gentlemen have in common?

Marnell and his son Anthony Marnell III, along with Tharaldson, are investors in privately held DesertXpress, a company which has so far spent $270,000.00 lobbying for a $4.9 billion federal government loan to build a high speed rail line from Victorville, California to the Las Vegas casino strip. Rogich is a consultant to DesertXpress. Private investors expect to put up only $1.6 billion in capital towards the $6.5 billion cost of construction and rolling stock for the project.

Victorville, California is a small town, population about 115,000, on the edge of the Mojave Desert. Vacant stores are scattered across the downtown area. DesertXpress proposes a 15,000 car “park-and-ride” lot on a remote parcel of land between Victorville and Barstow, California, where they say Californians from throughout the Los Angeles Basin will leave their cars and hop onto a bullet train for a 200 mile, one hour and twenty minute, $75.00 luxury train trip directly to the Las Vegas Strip.  The doubters question whether California folks will drive 50 miles to embark on a 200 mile train trip rather than just mashing down on the accelerator and driving the rest of the way to Las Vegas.

Why not run the train all the way into LA? Well, once you get past Victorville, acquiring the right of way through urban southern California would make the projected $6.5 billion cost of the DesertXpress proposal look like a mere drop in the bucket. However, in order to pay back the federal government loan they are seeking, Majority Leader Reid’s buddies will have to attract at least 2.5 million train riders every year, at a fare beginning at $75.00 per trip. The odds are very good, in Las Vegas terms, that the loan would never be repaid, and American taxpayers would end up owning the unprofitable high speed rail line to nowhere.

Southern California Association of Governments Executive Director Hasan Ikhrata points out that high speed rail has never been profitable anywhere in the world to date: “When somebody comes and tells me ‘I will build a system that pays for itself,’ I’m suspicious,” Ikhrata says. “There is no high speed rail system in the world that operates without subsidies.” While Senator Reid and other supporters of the project glibly brag that their plan will produce 80,000 new jobs in the region, the Federal Railroad Administration documents show that only 722 of those jobs would be permanent.

Whatever the goal of the stimulus funding Congress passed for high speed rail in America may have been, I doubt that very many of the Congressmen and Senators who voted for that legislation were thinking of replacing airline gambling junkets from LA or Orange County to Las Vegas with a bullet train.

High Speed Rail Shuffle Could Be Chicago’s Boon

Newly elected governors in Wisconsin, Ohio and Florida – all of whom have announced their opposition to high speed rail construction projects in their states – could be the secret ingredient in increased funding for high speed rail construction projects and rolling stock manufacturing jobs in the Chicago area. Under the stimulus appropriations from early 2009, $8 billion was set aside to fund high speed rail construction projects planned but not yet implemented across the United States. In January of this year the Obama administration announced allocation of $1.23 billion of that money to Illinois, to fund high speed rail corridors between Chicago and St. Louis, Missouri, and between Chicago and Milwaukee, Wisconsin.

Of the remaining $6.77 billion in high speed rail appropriations, $810 million was awarded to Wisconsin for construction of a high speed line between Milwaukee and Madison, and also the Wisconsin portion of the Chicago to Milwaukee service. Another $400 million was awarded to Ohio, for high speed connections between that state’s capitol, Columbus, and Cleveland and Cincinnati, Ohio’s other two major cities. Florida was awarded $2.06 billion for a high speed rail link between Orlando and Tampa.

Under the “claw back” provisions of the stimulus legislation, any money allocated to particular projects, but not spent by the states winning the funds, must be reallocated among other proposers who got less than they asked for in the initial grant process. Florida’s governor elect Rick Scott, Ohio’s governor elect John Kasich, and Wisconsin’s governor elect Scott Walker have all publicly stated their opposition to going forward with the high speed rail construction for which these federal stimulus funds were awarded, putting a total of nearly $3.29 billion back in play among the states seeking federal funds for high speed rail development projects.

IDOT’s original funding proposal under the stimulus appropriation sought a total of $4.5 billion, and the clawed back funds could more than make up the entire shortfall from the Illinois grant request. Though it is unlikely Illinois will be given the entire amount, U. S. Transportation Secretary Ray LaHood said last Monday, November 15, that he will soon be announcing the reallocation of the $1.2 billion coming back from Wisconsin and Ohio. Several governors who support high speed rail development, including Illinois Governor Pat Quinn, will be holding their breath until LaHood’s announcement is official, and maybe even longer, until Florida’s $2.06 billion grant is reallocated.

Quinn is already wooing Talgo, Inc. the rolling stock manufacturer that recently opened a plant in the Milwaukee facility formerly owned by Tower Automotive, where Talgo expected to put 125 people to work building cars for the Chicago to Milwaukee high speed rail corridor, which plans to include stops at Mitchell Field, Sturtevant, Wisconsin, and Glenview, Illinois, as well as the terminals in downtown Chicago and Milwaukee. Talgo has said it would consider moving to Illinois after fulfilling its spring 2012 orders for two high speed trains in Oregon.

So, because of politics in three other states, Illinois could end up a much bigger winner in the competition for high speed rail funding and jobs that initially seemed possible.

Stimulus High Speed Rail Curtailed

The first fallout of the election returns came down in Wisconsin today, with the announcement by the outgoing Democratic Doyle administration that design and engineering work on the $810 million stimulus funded Milwaukee to Madison high speed rail construction project will be suspended, pending a determination by the incoming Republican Walker administration. Wisconsin Transportation Secretary Frank Busalacchi says the stoppage is temporary, but governor elect Walker campaigned against high speed rail as a waste of taxpayer money.

Permanent cancellation of the extension of high speed rail from Milwaukee to Madison would imperil jobs at the Milwaukee plant of Spanish based Talgo, Inc, which was slated to manufacture new rolling stock for the Madison branch, where the intent was to increase train speed from the current 79 mph up to 110 mph along the route.

Additionally, Ohio governor-elect John Kasich has also reiterated his opposition to development of a high speed rail corridor in that state connecting Cincinnati, Columbus and Cleveland. It seems the $8 billion in federal dollars allocated to high speed rail construction in the stimulus package may never get spent after all.

Transportation Capital Funding – The Next Battleground

America’s position in the global economy is rapidly being undermined by a rapidly deteriorating and drastically underfunded transportation system. Congress’ failure to act before the midterm elections on a long term reauthorization of the Federal Highway Trust Fund is just the main symptom of pain in this sector. A report released yesterday contains warnings by bipartisan transport experts that unless
Congress and the public quickly get behind innovative transportation reforms, America’s global economic leadership will fade in the near future.

Yesterday afternoon Transportation Secretary Ray LaHood announced federal grants totaling $776 million to 45 states plus the District of Columbia for bus system improvements, but much of that cash will go to purchase busses and other equipment, and very little of it to transportation infrastructure construction.

Meanwhile, several Republican gubernatorial candidates in hotly contested state election races are making campaign promises to block the Obama administration’s ambitious plans for bullet train service in the northeastern industrial corridor from Boston to Washington, D.C. The Stimulus legislation committed billions to high speed rail construction proposals touted as “shovel ready,” but so far the shovels have not turned a single scoop of railroad ballast onto high speed rail construction projects anywhere in the nation. If economic recovery is depending on the construction industry to bring job growth, these gubernatorial campaign issues are an ill wind blowing the wrong direction.

Urban Democrats Press For Additional $4 Billion For High Speed Rail Construction

While the Obama administration is seeking only $1 billion for high speed rail construction in the 2010 Transportation/HUD appropriations bill, urban region Democrats in Congress want to bump that number up to as much as an additional $4 billion, on top of the $8 billion already included in the American Recovery and Reinvestment Act.

States wanting to create high speed, intercity rail corridors have already submitted applications for $50 billion in funding against the $8 billion the stimulus package makes available, and leaders in both houses believe high speed rail construction is one way to create new jobs with good pay. Also, many believe the level of 2010 funding for high speed rail development will indicate whether the stimulus funds for that purpose are merely an aberration, or a real government commitment to improving intercity rail transportation infrastructure across the nation. Senator Charles Schumer of New York says expansion of high speed rail networks will help "the country mitigate some of the environmental, energy and congestion issues that plague our roads and airspace."

High Speed Rail Grants 712% Oversubscribed

Out of the $787 billion in economic stimulus appropriations included in the American Recovery and Reinvestment Act, $8 billion was set aside for grants to develop high speed rail transportation projects around the nation. Yesterday the Federal Railroad Administration announced that it has received a total of 259 applications for grants, from 34 different states, requesting a total of $57 billion. Among the proposals are 45 projects requesting $50 billion for advancement of intercity rail corridors on which trains could travel faster than 100 m.p.h. The other 214 applications from 34 states ask for $7 billion to upgrade rail travel at speeds less than 100 m.p.h.
Of course, this oversubscription represents another cause of the incessant delays in injection of federal stimulus cash into the nation's economy. While the FRA deliberates over deciding which states and which projects will be winners and losers in this race, the gandy dancers of America remain firmly seated on the sidelines, hammers between their knees.

Chicago Regional Rail Summit

Five midwestern governors are meeting in Chicago today with railroad executives to make lobbying plans for a chunk of the $8 billion in stimulus appropriations for high speed rail construction. Illinois Governor Pat Quinn, Iowa Governor Chet Culver, Michigan Governor Jennifer Granholm, Ohio Governor Ted Strickland and Wisconsin Governor Jim Doyle are planning a regional high speed rail network with Chicago as its hub, and they are competing against 277 other grant applicants. Forty states have requested a total of $102 billion, despite the availability currently of only $8 billion in federal stimulus cash. The five governors hope a regional application may boost their grant request to the top of the short list.

High Speed Rail Demand Heats Up

The U. S. Department of Transportation has announced that 278 separate grant requests have been filed seeking funding out of the $8 billion appropriated for high speed rail construction in the American Recovery and Reinvestment Act. If your business builds rail lines, or supplies those who do, get out your pencils and sharpen them, it seems a raft of contracts will be coming up for bidding once the successful grants have been awarded.

Highway Trust Fund Reauthorization Delayed A Year And A Half

Senate leadership support for a temporary 18 month extension of the Highway Trust Fund seems destined to insure that no permanent reauthorization bill will come out of Congress for at least that long, and maybe not at all during President Obama's first term in office. Senate Majority Leader Harry Reid, together with Senate Environment and Public Works Chairman Barbara Boxer and Ranking Member James Inhofe, have all come out in favor of an 18 month temporary extension bill.

House Transportation and Infrastructure Highways Subcommittee Chairman Peter DeFazio predicts the 18 month extension bill will cost the construction industry a million jobs because states will not begin investing in long term projects until a full six year reauthorization is passed. And House Transportation and Infrastructure Chairman James Oberstar predicts the 18 month delay will stretch to four years before a long term reauthorization can be enacted. "An 18 month extension will put us into the next presidential election cycle. It will take four years," Oberstar said. "I know how this body works ... Inertia becomes the enemy of progress."

Meanwhile, House Transportation, Housing and Urban Development Appropriations Subcommittee Ranking Member Tom Latham predicts the Highway Trust Fund will become insolvent in about three weeks from today. The subcommittee Monday unanimously approved its portion of the fiscal 2010 transportation and infrastructure budget, which includes #10.5 billion for public transit construction, $1.5 billion for Amtrak construction, and $4 billion for high speed intercity passenger rail construction.

High Speed Rail On LaHood's A List

In a speech Tuesday at the National Retail Federation leadership conference, Transportation Secretary Ray LaHood repeatedly referred to the need for the United States to develop high speed intercity rail transportation, referring to the stimulus bill's $8 billion in seed money for these projects. In spite of funding difficulties, LaHood said he expects House Transportation and Infrastructure Chairman James Oberstar to produce a workable five year transportation reauthorization bill "pretty soon."

Meanwhile, Congressmen both on and off Oberstar's committee have noted a softening in the Chairman's stance regarding the posting of earmark requests on their websites. In a May 4 letter Oberstar and Ranking Member John Mica merely asked Congressmen to "please post requests for projects on their websites." Although all the earmark requests will ultimately be posted on Oberstar's committee website, the chairman refuses to set a deadline for individual members to post their requests on their own sites, and also refused to say he will disallow any earmarks not posted on individual Congressmen's sires before the legislation passes.